Skilled Healthcare Settlement Press Release

September 8, 2010

Plaintiffs' counsel -- Janssen, Malloy, Needham, Morrison, Reinholtsen, Crowley & Griego, LLP, the Law Offices of Michael D. Thamer, and Christopher J. Healey and Aaron Winn from Luce, Forward, Hamilton & Scripps, LLP -- are pleased with the results of the negotiated settlement, which requires court approval. We believe the proposed settlement serves the best interests of the Class of persons residing in each of the skilled nursing facilities in Humboldt County and the other named defendant skilled nursing facilities throughout California. Although the monetary amount of the settlement is less than the verdict, we are satisfied that it reflects the best possible recovery for our clients taking into consideration the uncertainty, risks and delays associated with proceeding to judgment.

The settlement value of sixty two million and eight hundred thousand dollars includes the costs of an injunction, valued at twelve million eight hundred thousand dollars and an additional fifty million dollars to cover settlement payments to class members, notice and claims administration costs, certain service payments to named plaintiffs, plaintiffs’ attorneys’ fees and costs (to be approved by the Humboldt County Court) and certain other payments.
The injunction will remain in effect for a period of 24 months unless extended for additional three-month periods as to those defendants that may be found in violation. Defendants demonstrating compliance for an 18-month period may petition for termination of the injunction.

The verdict and settlement would not have been possible without the hard work and commitment of employees of the Humboldt County Superior Court and the dedication of the jurors, who served more than six months in what we are told is Humboldt County's longest jury trial.

We cannot stress enough the importance of the participation and collaboration from the Humboldt County District Attorney's office. Mr. Gallegos and his colleagues worked side-by-side with us for more than four years and for that we are extremely thankful.